The start of public concession tender to select a private investor for the state enterprise Kherson Sea Trade Port (KSTP) may be announced in November 2018, as declared by Chairman of Infrastructure Public and Private Partnership (PPP) Development Project Office SPILNO Taras Boichuk, Press Office of KSTP informed.
“As of today we jointly with our partners – International Finance Corporation and European Bank of Reconstruction and Development – have completed working out the feasibility study (FS) for the development of KSTP. For the four and a half months we closely collaborated both with the company’s management and trade union, and the working community. This FS shall be considered by Ministry of Infrastructure of Ukraine (MIU) in the nearest months”, advised Mr Boichuk at a meeting in Kherson on Tuesday. The meeting was attended by managers of the port, the port’s trade union, and representatives of the Ministry.
According to the Ministry’s State Secretary Andrii Halushchak, as of today the full-extent mutual understanding was managed to be reached with the labour of the public stevedore – now the workers do clearly realise the vitality of the company’s transfer from state property to management of an efficient private operator. “We focus in particular on the fact that the would-be investor is going to be fully liable to secure social guarantees to the working collective. Moreover, he should present a clear programme of KSTP economical figures substantial increase. The key issue in it is that the future investor would be not just a port operator but also a cargo flow owner in order to provide significant growth of the throughput and accordingly highest dynamics of the enterprise’s development”, noted Mr Halushchak.
As per the FS presented, in the nearest five years on account of the port’s activities it is anticipated to enlarge revenues into the local budgets for minimum 55M UAH. Ministry of Infrastructure burdens a potential operator with obligatory tasks: the initial investments to embrace not less than $10M, compulsory payments (dividends) to the fisc should be effected on the level of the last three years. Besides, the signed collective bargaining agreement (CBA) must be intact within five years and the moratorium should be placed on the staff reductions. The concession term will amount to 30 years.
Another condition of considerable importance: all the economic and financial activities of the port should be exercised in fully open and transparent mode with free access by public. Some of landmark stages within this condition will become public negotiations with concessionaires acting in the maritime field, to be held as soon as on 18-19 September.
As mentioned Acting Director of KSTP Oleksandr Sukhin, the company’s transfer to concession is a crucial process for economic development. “Nowadays there is clear understanding of this both in the Ministry, and in the port’s labour. And it’s very encouraging that we are at last on a fast track of this route, after which the enterprise, as we do sincerely hope, will take serious changes towards better”, noted he.
SE KSTP and SE Stevedoring Company Olvia (previously SE STP Oktiabrsk) are among the public companies the PPP pilot project to be realised at. The corresponding projects were adopted by MIU on 23 June 2016. In May 2017 the development of pre-FS of pilot concession projects was completed with the support by World Bank and EBRD, showing expediency of the detailed FS further working out.
In late 2017 a memorandum of cooperation between MIU and IFC was signed, as well as an agreement between SE USPA and EBRD on further development of FS for pilot projects. In February 2018 EBRD selected a consortium of international consultants to work out FS and prepare tender documentation for both ventures.
SE KSTP is loosely categorised as a minor sea port. The state-owned stevedore provides operational activities in the harbourage of Kherson port being the key sea port on the Dnipro River flowing through major industrial and agrarian regions of Ukraine. The port has approach motor roads and railways.
According to the register of SE USPA (Ukrainian Sea Ports Authority), SE KSTP operates Berths 1 (Basin 1 left side), 2, 3, 4, 5 of the port of Kherson.